I see the loom of the DeutscheFranc just below the horizon.

The death knell of the Euro has been sounded. Ten year interest rates for Ireland and now Portugal above six per cent are not sustainable, the ludicrous concept that countries forced to incur such payments can realistically be expected to fund the rescue of Greece and later no doubt others, may seem sensible to those befuddled by the fog of the EU having been trapped within or around its Institutions over many years. These eurofanatics may still believe that holding the concept of European Monetary Union together for all 27 member nations is still feasible as intended in the EU Treaties, the saner world outside will not. We are thus heading towards a MarkFranc or perhaps more likely a DeutscheFranc as this posting's title suggests. In the Global Arab Network yesterday an article titled "Lack of common vision could sink Euro -Impede EU progress" by Katinka Barish descibes the problems neatly, one quote being the following: To avoid such dangerous imbalances in the future, the eurozone countries need to better watch and coordinate their economic policies.... The Franco-German alliance – traditionally the motor behind big integration projects – is fraying. Chancellor Angela Merkel and President Nicolas Sarkozy do not get on and they disagree on fundamental points of eurozone reform. Merkel prioritizes strict rules for all EU members and sanctions on fiscal sinners while Sarkozy wants discretionary economic policy coordination among the eurozone members. Because they diverge on so many points, there’s almost daily consultation between Berlin and Paris. In spite of the public and apparently growing differences between the two main forces behind the EU project, they will surely soon discern that should they continue not to hang together then they will quickly fall apart, most likely at the seams. Signs that this is being recognised by President Sarkozy in Paris came at the end of last month when it was announced that a report is being prepared to discuss the convergence of France's fiscal system with that of Germany. A sensible first step to any currency union as the failure of the Euro so painfully points out. EU Observer had more on this topic linked here. Whether or not such a union is possible will very much depend on a means being found of disposing of the ECB liabilities resulting from the long and disastrous Euro experiment, or whether the resulting squabble will prevent agreement on the best way ahead, thus strangely leaving Europe with only one viable reserve currency, the Pound Sterling, all this of course, yet remains to be seen, thus throwing further confusion into an already chaotic world economy!